Policyholders who rejected an insurer’s preferred builder after reading online reviews have lost their bid for a cash settlement for home repairs. 

The homeowners wanted a settlement so they could hire their own builder to repair damage caused by a hailstorm in December 2023. 

Youi rejected their request because the policy allowed it to arrange repairs, and the Australian Financial Complaints Authority (AFCA) has sided with the insurer, saying the policy wording is clear. 

"While the complainants say they do not have confidence in this builder due to online reviews, I am not persuaded this is sufficient basis to override the terms of the policy,” says the ombudsman. 

The homeowners acknowledged the policy allowed Youi to nominate a repairer but argued there were reasonable grounds for a cash settlement.  

They said the insurer’s repairer has an approximate 3.0-star rating on Google, with multiple reviews expressing dissatisfaction with service quality and project management and, given the significance of a roof replacement, they did not feel confident about Youi’s builder. 

Their preferred repairer had a 4.9-star Google rating with many positive reviews.  

The ombudsman agrees with Youi that online reviews are not independently verified and may not be an accurate reflection of a builder’s performance.  

They note the insurer’s builder also has a number of good reviews. 

The policy also provides a quality guarantee if the insurer’s builder carries out the works, says the determination. 

Read the ruling here.